(Table) According to the table, what is the price elasticity of honey when the price of a jar of honey is between $2 and $4 (use the midpoint method to calculate your answer)?
$\begin{array}{|l|l|}
\hline \begin{array}{l}
\text { Price of a Jar } \
\text { of Honey }
\end{array} & \begin{array}{l}
\text { Quantity of Honey } \
\text { (millions of jars) }
\end{array} \
\hline \$ 2 & 10 \
\hline 4 & 8 \
\hline 6 & 6 \
\hline
\end{array}$
A) 0.33
B) 3.00
C) 0.50
D) 5.00

Question

Quizplus · Accepted Answer

The midpoint method for calculating price elasticity of demand is:$$\frac{	ext{Percentage change in quantity demanded}}{	ext{Percentage change in price}}=\frac{\frac{Q_2-Q_1}{[(Q_2+Q_1)/2]}}{\frac{P_2-P_1}{[(P_2+P_1)/2]}}$$Plugging in the values from the table, we get:$$\frac{\frac{8-10}{[(8+10)/2]}}{\frac{4-2}{[(4+2)/2]}}=\frac{\frac{-2}{9}}{\frac{2}{6}}=\frac{-2}{9}\cdot\frac{6}{2}=\frac{-12}{18}=-0.67$$Therefore, the price elasticity of honey when the price of a jar of honey is between $2 and $4 is -0.67.

(Table) According to the Table, What Is the Price Elasticity